As belts begin to tighten, wise finance directors have been paying special attention to their cash management.
Charities rightly want to be as confident as possible that they have enough cash and can get at it when they need it. But the recent spectacle of failures among previously well-regarded financial institutions has raised the inevitable question of "who's next?" from nervous depositors.
We have three primary considerations when deciding what to do with our cash: liquidity, yield and security. Unfortunately, these sometimes pull us in conflicting directions.
As attractive as deposit rates may be at the moment, few would dispute that security has got to be the top priority when investing short and medium-term cash. Just imagine how you would feel if all your cash was with one bank and that bank went bust.
It's the old risk-return trade-off - if you're hell-bent on getting the best rates, you're probably taking some risks. Just why is that bank so keen to have your cash? The credit ratings awarded by agencies to some banks and funds offer a guide - though no more than that - to risk levels.
Some finance directors have reduced the amount of cash they are willing to entrust to any one bank. Spreading your funds across different institutions can certainly be a useful way of managing risk, but you still need to think about the nature of the risk you are facing in each case.
One thing you should consider is whether your cash will be held as part of the bank's own balance sheet, as with a fixed-term deposit, or ring-fenced in a separate vehicle such as a cash fund.
If you are using funds, remember that they are not all the same, and try to understand what your potential exposure could be under different scenarios.
Let's not get too scared. It is easy enough to make sure that your cash is as safe as can reasonably be expected, while still earning a healthy return.
But that doesn't happen by accident, so if you think you need to tighten your grip on cash management, now's the time to do it.
- Heather Lamont is a client investment manager at CCLA.